Import Plastic Products from China
A Complete Guide: How to Import Plastic Products and Goods from China?
Plastic is the sixth most exported global product items around the world. China is the largest exporter country with a recorded export value of USD64035659 thousand during the year 2016. U.S.A, Hong Kong, Japan, and India are the top importer countries of China.
Why is China the largest producer?
China exported plastic product under HS code 3926 which is the articles of plastics and other material heading 3901 to 3914 with the value of USD 17485328 in 2016. And HS code 3926 contains miscellaneous plastic items. China is the second largest exporting country of plastic followed by Germany U.S.A, Korea, and Belgium. A Chinese product seems to be everywhere and the product ranges involve our daily requirements for highly engineered goods. The reasons for such high imports of plastics articles is low-cost production, availability of cheap labor, mass production, low wages and various benefits from the government to promote exports.
Here are some procedures and formalities to import plastic sheets from China. After globalization of trade by GATT (General Agreement on Tariff and Trade) the procedures and formalities to import plastic products from China are same in most of the countries.
Permission from drugs controller
The permission from drugs controller is important in most of the countries to import plastic sheets for pharmaceutical use.
Some of the countries like India attract anti-dumping duty on the importing of plastic articles. And according to GATT, WTO members can take an individual decision on imposing an anti-dumping duty to ensure fair trade rather than protecting domestic industry.
Hazardous waste management handling and Tran’s boundary movement rules
This rule aims to prevent the country from becoming a dumping yard for industrialized nations. So, any importer who is importing plastic sheets should follow the terms and conditions of such Hazardous waste management, handling and Tran’s boundary movement rules before the actual import of plastic sheets take place.
Permission from environment department
Permission from environment department is essential to import some of the items under plastics. The ministry of environment and forest (MOEF) is authorized government department to regulate plastic materials including importation in India.
Test report of analysis from laboratory
To import plastic and plastic article the importer must obtain a test report from laboratory authorized by importing country.
License from Foreign Trade Office
In India, DGFT (Director General of Foreign Trade) is the governing agency to issue a license to the importer.
RSP based Valuation
Some plastic articles fall under RSP based valuation to estimate import tax.
General Requirement to act as an Importer of plastic from China
In some countries, government registration is required to become an importer in the country. The foreign trade government office of that country is responsible to issue an authorization to the importer.
Here are some essential steps that to be fulfilled in order to start an import business.
- A firm or company should be registered in India.
- For registration, you can get a license from Municipal or Corporation.
- Need to have a current bank account combing with SWIFT code.
- Tin required- tax identification number is next essential things to be required. And to obtain Tin you need to register with the State Tax Department or Central Sales Tax.
- IEC code (import-export code) – while importing or exporting goods from China to India or vice-versa, there i9s a necessity of IEC code which is a 10 digit code, issued by Director General of Foreign Trade, Government of India or Ministry of Commerce to Indian firms or companies.
To Ship Product Import from China
- Selected reputed supplier and ask them to send the sample first before placing an order in a bulk.
- When you place your order the supplier will send your invoice.
- Now contact third party shippers as they will take care of your shipping, documents.
- Hire a Freight forwarder– Freight forwarder is a person or company that organizes point to point shipment to import goods from the manufacturer. They can handle and manage the customs. You can hire than in cities of India like Delhi, Bangalore, Chennai, Hyderabad, Kolkata, etc.
- LCL companies– LCL companies are the best choice that offers all-in-one price shipping service and are specialized in certain ports or areas. They will handle all custom and shipping process and deliver to the door.
- BIS production certificates scheme- BIS certification is not mandatory for all products, but Indian importer needs to ensure if their product is applicable to BIS certification before ordering.
- ISI mark– ISI mark is printed on products compliant with the applicable IS standard. Therefore, you need to secure IS compliance before you send your ISI logo files to your Chinese manufacturer.
Indian import duties and custom values
The customs fee depends on the type of product you are importing from China. The average duty in India is around 12% and the import duties and other taxes are calculated based on the CIF price that is cost, freight, and insurance. It includes the value of the product, shipping, and insurance. So the import duty is calculated at the percentage of CIF price.
Other fees and taxes
Before you order from Chinese supplier you have to make sure to confirm which taxes and rates apply to your imports like lending charges, countervailing duty, CESS and CVD all ranging from 1 to 12%.
What is MOQ (Minimum Order Quantity)?
MOQ depends upon the product you are importing, cost and mode of transportation, their production capacity. The MOQ for import of plastic sheets also depends on the type of sheets like for poly-carbonate sheet the MOQ is 500 sqm. and for PVC sheet it is 1000 kg, and for the high-quality sheet is 1000 sqm.
Why India Import Plastic Goods from China?
In India, the center had increased the customs duty on plastic granules from 5% to 7.5% and in contrast, the duty on import of finished goods remains unchanged this result in cheaper import from China.
List of major Chinese supplier and exporter related to Import Plastic Granules from China, Import Plastic Products from China
- Shanghai King Sign International Trade Co. Ltd.
Products: Acrylic tubes, Acrylic sheets, PVC foam sheets, PETG sheets, PET sheets, etc.
- Qingdao Topack Packaging Co. Ltd.
Product: Cardboard gift boxes, cosmetic packaging, woven labels, PVC packaging bags, etc.
- Jinjiang Jiaxing Company
Product: Cooler bags, Packaging tape, etc.
- Guangdong Goody Plastic Co. Ltd.
Products: Plastic extrusions, Plastic sheets, Roller sutler, PVC windows, PVC pipes
- Linyi Ditie Trade Co. Ltd.
Product: PVC ceiling panels, Snow Shovels, Construction Plywood, etc.
- Jinan Guangwen Xing rubber and plastic Co. Ltd.
Products: Grocery bags, Retail Plastic Bags, Trash and Lawn bags, Garment Packaging bags, Plastic Packaging bag, etc.
- Zibo Zhongnam Pharmaceutical Packaging Materials Ltd.
Products: Cooling towers, PVC film, Packaging films, medical and hygiene production packaging, PET films, etc.
There are lot of suppliers are available on http://www.alibaba.com
How to know the quality, quantity, or contents of goods before import?
The Customs Department filed a legal document called Bill of Entry. After filing Bill of Entry the importer or customs broker requests the concerned custom appraising officer to mark open examination order. After obtaining the open order, the customs broker or importer approaches the customs personnel to inspect the cargo. Then the goods are inspected completely or partially as per the requirements and prepare a report on examinations of goods. The samples of commodity/goods are also drawn for quality checks, once after satisfying the quality, quantity, and contents of the consignment, the importer can proceed further in completing import customs clearance procedures to take delivery of cargo.
Payments Methods to Import Plastic Products from China
TT (Telegraph Transfer)
It is a standard bank transaction which placed through internet bank or by a local bank branch
- Deposit payment(35%)
- The manufacturer starts the Production.
- Production completed
- Quality Inspected and Compliance testing
- Buyer approves consignment
- Delivery to the Port of Loading (e.g. Shanghai)
- Bill of Lading Scan, Copy provided
- Loading and Shipment of goods
- Balance payment (65%)
- The seller sends original Bill of Lading and other freight documents (required to release cargo in Port of Destination)
Letter of Credit (L/C)
It enables the buyer to add an extra layer of security, by forcing the supplier/ exporter to fulfill certain requirements before the funds are transferred. Under L/C, the bank will automatically release the funds to the supplier and then credited to the buyer automatically once conditions/ requirement have been fulfilled.
- A sale agreement is signed by the seller and buyer that states the conditions to be fulfilled before the payment shall be released.
- The buyer contacts its local bank and applies for L/C.
- The buyer’s bank contacts the seller’s bank (in China) and presents the Letter of Credit.
- The seller’s bank contact the seller and shows a payment advice
- The manufacturer starts the Production.
- Production completed
- Quality Inspected & Product Testing.
- Deliver to the Port of Loading and Shipment.
- Provides the required documentation to their local bank (e.g. Quality Inspection Report, Test, Report, and Freight Documents).
- The customer then releases the funds, if the conditions are fulfilled (i.e. the right documents are presented).
Payment Security Points
- Exporters balance payments and deposits are recommended to divide. That is 30% of deposit (before product) / 70% of balance (after production).
- Never pay deposits before you have signed and stamped Sales Contract and Invoice.
- Don’t pay the balance before you completed any quality checks/inspection.
- Never pay 100% before production that will remove supplier incentives to remake or repair defective items.
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